Rents and economic development: the perspective of Why Nations Fail
Daron Acemoglu and
James A. Robinson ()
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James A. Robinson: University of Chicago
Public Choice, 2019, vol. 181, issue 1, No 3, 13-28
Abstract We present the approach to comparative economic development of Why Nations Fail. Economic prosperity requires inclusive economic institutions—those which create broad based incentives and opportunities in society. Extractive economic institutions, which lack these properties, create poverty. Variation in economic institutions is created by differences in political institutions. Inclusive economic institutions are the result of political choices which arise under inclusive political institutions: a strong state and a broad distribution of power in society. When either of these conditions fails one has extractive political institutions that lead to extractive economic institutions. We relate our analysis to Tullock’s notion of ‘rent seeking’.
Keywords: Rents; Institutions; Inclusive; Extractive; Politics (search for similar items in EconPapers)
JEL-codes: D72 D78 O00 O43 (search for similar items in EconPapers)
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